petition that the president can invoke the 14th amendment and raise the debt ceiling without the approval of congress. that's interesting. >> would go over well. i'm mel liz is a francis. happy new year, by the way. >> great to see you, hope you had wonderful days off, missed you around here. i'm lori, and it was not pretty, but we have a deal to avoid the fiscal cliff. stocks absolutely soaring, the dough up 22 # 2 now, biggest first day of the year gains in at least five years, all 30 dow stocks, in fact, trading higher. >> but, no matter what the income level, your taxes are going up. i don't know if you realize that. peter barnes continues his look at just how much more it is going to cost you. >> just talk about this, a congressman joining out on the congress wheeling and dealing and preparations for the next cliff. the debt ceiling two months from now. >> automatic spending cuts delayed until march as well. what's that mean for defense stocks? that's just ahead p.

>> the industry setting up to get really pummeled if they don't doing do something about sequestering. back down to the floor of the new york stock exchange, happy new year, first time seeing you, nicole. what's the word on the floor this morning? a lot of optimism. >> happy new year to you as well. a lot of optimism, positive stocks here, up arrows, vix, fear insex, and five year low, you're seeing deals moving higher today, 1.83 #% for the ten-year, gains across the board, all of this, obviously, a couple thicks happening here. number one, you have lawmakers in washington averting the fiscal cliff, coming to a decision, avoiding disaster, potentially, and with that, there's on optimism here on wall street, s&p 500 up 1.7%, and dow up 226 right now, winners, people stepping in, had been on the sidelines, cashed out in december and throughout last year, concerned about taxes.

they took profits and are going to get back in, traders say we'll see the january effect where people get in here and get back into the market. looking, also, talking about mergers, acquisitions, looking at aivs aad zipcar. avis bought zipcar, nearly a million dollar deal, and so you see here avis up 5%. this car up over 48%. it's a 49% premium that's why. this gives them potential in growth for avis and there's an up arrow there for avis as well. great day on wall street and those two names, back to you. >> thank you so much, as always, nicole. >> despite the last minute deal in the fiscal cliff, many americans will see increases in their taxes in the new year no matter your income level. peter barnes has a break down of the deal. peter? >> well, hey, melissa. taxes hitting taxpayers this year including from this week's tax bill. the big change this week with the restoration of the top marginal tax rate of 39.6% from

the clinton era if individuals making more than 400,000 a year, and families more than $450,000. they see rates on capital gains and dividends rise to 20% from 15%. unrelated to the tax legislation is a new tax under president obama's health care reform law that a 3.8% medicare surcharge on investment income for individuals making more than $200,000 a year and families making more than $250 # ,000. the tax increase to hit almost all taxpayers, lower income as well as upper income, is the expiration of the payroll tax cut from the last two years, and that is the main thing that is increasing taxes for households earning $100,000 to $200,000 a year. that's the income bracket we look at at this hour. according to the tax policy center, they go up, on average, by about $1800 a year as social security withholding rises to, back up to 6.2 #% this year from

4.2% the last couple of years. melissa? >> all right, peter barnes, thank you so much. >> uh-huh. >> keep it here on fox business. in the next hour, what it means for individuals making $200,000 to $500,000. full coverage of all peter's reports also on foxbusiness.com because a lot do not realize that their taxes have gone up overnight, even if they don't make more than $400,000 or $450,000. >> this is not even the taxes related to obamacare. that's another slew of taxes hitting the country. we're going to get into this more here throughout the hour. for now, directing the conversation to a democrat from vermont voting yes on the deal, but says as far as the fiscal package to stabilize the u.s. economy, this deal is far short. with the prospect of a catastrophic national default in two months from now, what does he see happening in washington? representative well much, thank you for joining us.

sir, welcome, and happy new year. >> same to you, thank you. >> when the deal falls short, do you think more people should have seen taxes go up this year? $450,000 to the $250,000 level? >> well, the main thing i would have likedded is what the president and speaker boehner were working on, the grand bargain, literally putting everything on the table and have a $4 trillion dent in the deficit. that eluded us. that's the disappointment. we've got that fiscal cliff situation again with the sequestering in march. what we did accomplish was we looked at this in a very pragmatic way and took a step, and it's a modest step, but in the right direction, and market reaction is cheering the fact that we moved in a right direction. >> i want to key in with the point about the grand bargain. congressman, it's worth reminding the viewers that the largest parts of the federal budget are exempt from cuts, entitlements and interest

payments on national debt. how optimistic are you on reform and make cuts that decrease the rate -- not asking for actual deficit reduction, but increase the rate of the growth -- decrease the rate of that growth. >> you hit the heart of the problem. health care, medicare, private paid, employer provided health care, the cost of health care's going up oftentimes two and three times the rate of inflation. in this country, of course, pays the highest in health care of any western industrialized country, a huge disadvantage. the folks who say, hey, we got to deal with the costs, they are right. republicans and democrats agree on it. we're having a bait l is a lot of us on the democratic side think we have to reform how we deliver health care. we've got to, you know, have prescription drug price negotiations, got to find savings. the republicans approach has been to cut benefits, to save money, and somehow we got to find a way to work together towards the common goal making

the cost of health care affordable and steanble. >> tock about the approaching debt ceiling because, congressman, you gathered signatures basically supporting the president whether or not to invoke the 14th amendment allowing him to raise the debt ceiling without the approval of congress. >> right. >> why, then, are you so confident we need to raise the debt ceiling without getting cuts? why would you be satisfied is the question? >> see, i actually think whether it's republicans or democrats, we both grand standed on the debt ceiling, but it's a bogus issue. you buy a refrigerator, it's on the credit card, and the bill comes at the end of the month and it's above the self-decided limit on how much you'll pay on a credit card so congress is really pretty irresponsible in playing with the debt ceiling. a lot of collateral damage to the economy, but, in fact, congressional policy that preexisted when the debt ceiling hits, all required the spending to then be accommodated with the debt ceiling. >> what's the purpose of havinga

debt ceiling? colleagues say u.s. is in danger of going the way of greece right now with being extremely over leveraged and experiencing credit shock with sky high interest rates, which to me personal surprise, we have not seen yet. higher today, but because there's a market rally. >> it's a fair question. there's only two countries that have a dell ceiling, that's norway and us. bottom line, it's the fiscal policy, taxing and spending policy that you approve over the course of time that get you into trouble, and we made a lot of, i think, decisions, from my perspective that the war in iraq and afghanistan, on the credit card, first time we actually lowers taxes during a wartime conflict. the bush tax cuts didn't pay for themselves, and so we get in a back and forth, but the republicans and democrats, the congressional policies that lead to the excess of debt, and our debt has to come down.

>> yeah, well, you know, congressman, thank you for the time, optimistic about a grand bargain, and many echo that sentiment. thank you for talking, happy new year. >> same to you. >> calling the fiscal cliff deal a missed opportunity. clearly, the markets, though, don't think for now. let's see what brian gardener, kbw in washington, research joining me now. brian, thank you for joining us. >> sure. >> when the dust clears on this, what do you tell clients? good or bad for the markets and the economy? what's the take? >> a short term good. we averted really bad stuff. if we went over the cliff, we would have been going into a short term economic recession. we averted that. that's good. longer term, it's not as good. we didn't get the grand bargain that congressman welsh alluded to. i didn't think it was possible. that's the next step. i think the market is coind of enjoying the celebration of the fiscal cliff victory, and we'll shortly start to, then, refocus on the bigger problems.

>> we're looking at a market up 231 points, but on average, trading up on the first trading day of the year anyway. average is 2%. we're not really doing better than we would have than any other first trading day of the year. that said, when you look at the notes from jpmorgan, for example, poses considerable near term head winds to growth doing very little to address longer run fiscal stainability issues. they think in the long run, or, not even the long run, but relatively near term, when people look at it, it's not a good deal for the markets and economy. >> well, i mean, look, we had very anemic economic growth for the better part of the last four years. that is not going to change. this deal is not a game changer, doesn't change that. the only sense of why i'm somewhat positive on the keel is what the alternative was. i mean, the -- there are two alternatives to what we had. one was a grand bargain. the other was going over the

cliff. the going over the cliff would have been disas rows in the short term. i just think that the grand bargain was just totally implausible given a lame duck session. lame duck sessions always underdeliver on policy changes, and i would argue, i will make the argument that doing major policy changes of a grand bargain. in a very short time frame, between the election and end of the new year, could have actually resulted in bad policy changes. people rushed to get things through. >> although, i'll interrupt you because people say that about this particular deal, but how important is it, then, that, i mean, maybe it takes the new congress, but how important is it for the government to sit down and really get their financial books in order at this point? how important is it to the economy and to the u.s. maybe in the next year or two? let's not talk really long term, but relatively near term. >> at some point, the individuas step in saying enough is enough.

what that means, nobody knows. at 2013, congress and the administration are going to have to sit down and change the trajectory of why the u.s. budget is going, and to the extent they do that successfully, then that drag on the economy, i think, is diminished. i'm not that hopeful they will get anything done, but that's what they are looking at. >> brian gardener, thanks for coming on. >> thank you. >> an investing legend, how did the books stack up last year? >> the latest on the oil rig holding more than -- that's run aground in alaska, a storm causing real trouble there. look at metals as we head out to break as well. ♪

>> left high and dry, large oil drilling vessel grounded in the alaska gulf. the rig oinked by royal dutch shell carrying 143,000 gal loons of diesel, 12,000 gallons of hydraulic fuel. attempts to sal individual the situation is halted as experts are unable to board the ship due to a severe storm in the region. the coast guard and local officials were planning to mobilize response equipment as two endangered species inhabit the region.

operations manager stated that investigation into the cause of the grounding will be conducted once the situation is under control. royal dutch shell right now trading down 10 crepts there. >> is it leaking? >> not that they know of yet. it doesn't seem like anything's out of the ship. >> that'sed -- that's good. >> for now. >> the bp spill a couple years ago, we'll be glued to that. 15 minutes since we checkedded in with nicole, and this rally holding up, nicole, up 228 on the dow. >> that's right. looking good on wall street, all 30 dows in the green, hp, beaten down in 2012, one of the best performers on the dow jones industrials so you are seeing gains across the board. apple, facebook, you have new highs for some of the credit card companies. you have automobiles on the move, ford and gm at new highs so a lot of action, a lot of stories coming into play as

well. i wanted to take a look here at one of the materials and commodities, and in particular, looking at steel. u.s. steel is a stellar performer today. look at what it is right now. 7%, up a buck-65 at 25.50 now, and analysts helping them along in the potential going into 2013 raising them to an out performed from a neutral to the credit score. they are upballet on the sector here in 2013, raised several companies within that sector, and, certainly, looking good there and just talking about improved demand, supply, low inventory. good news for the steel stocks and u.s. steel leading the s&p 500. back to you. >> thank you, nicole. >> time to make money with charles payne, bringing us stocks to make you money and book a restaurant reservation at the same time. >> yeah. >> i know what it is. >> i think you know too. you have used open table before. >> absolutely. >> i talked about the stock, and extraordinary voil till.

that's up front. the last time i mentioned it, it was hit, came back, annie coal's talking about stocks at 5 # #-week highs, but it's been up to $105 a share. here's the problem. you got 45% short position on this thing. >> charles, i can't believe you recommend this stock. >> because i think the it charts are wrong. if they break out, they have to scramble. >> what's the catalyst? >> more good news. for example, operating margins up 24%, 27%, 44% over the last four years. business is getting better, and it's self-fulfilling. the more restaurants on, the more diners, more diners, the more restaurants involved, the more restaurants, the more diners. i tried, and i went to the website, but they sent me to open table. >> did you get the reservation? >> no. >> that's the problem i have with open table is i go there, and i can't get anything. >> they don't have enough tables

at an individual restaurant. >> they don't have enough tables, and i'm bad with this stuff. this is a little offshoot of the peter lynch by what you know or what other people know. i never had an apple product, but i recommended this stock, and in this case, i'm not good with open table, but i know a lot who like it. >> it's a good product? >> it's a good product. >> a competitor, and that -- >> saber? in new york? >> there's no real, you know, they actually have a -- >> saber? >> i don't know. it's a new one in new york that does, like, bills on the table. >> a fragmented market, and, of course, the industry itself, thousands of restaurants, people taking reservations with pen and paper, using a telephone and voice mail. amazing upside potential. >> high end restaurants and the diners all using open table to, at least service some reservations. >> that's true. >> gets a good 20% move in a short period of time. to your appointment, it is higher than normal risk. >> all right.

i appreciate that. >> starting the year off. >> one that we'll revisit. >> okay, cool. >> for sure, charles, thank you so much. buying time, the fiscal cliff deal, staving off cuts for a couple months, but then what for defense stocks? that's next. >> nice just to have a break from fiscal cliff discussions with charles just now. anything else? a new restriction on the number of cats, yes, felines that you can own. attention all cat ladies out there. new laws, the number of cats owned to the water bottles you use. crazy new laws for the new year ahead. check the collar. a weaker dollar impacting commodities setting oil and gold prices up. turn around? apparently so. scramp that. the dollar is stronger. it was weaker earlier. there you go, 31.62 is across to the euro. ♪ [ male announcer ] where do you turn for legal matters?

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>> hello, everybody, i'm uma with your fox news minute. pennsylvania governor says he's

suing the ncaa to overturn harsh penalties over penn state university with the sex abuse scandal saying the sanctions including a $60 million farm harm past, present, and future students there. the ncaa calls the lawsuit without merit. open house held today at a school for students who survivedded the massacre at sandy hook elementary school in newtown, connecticut last month. classes begin tomorrow at a former middle school nearby where workers and teachers have been painting and preparing classrooms. prosecutors and defense attorneys in the colorado shooting case say they are ready for key hearing next week when prosecutors outline the case against james holmes charged with killing 12 and wounded dozens of others in a movie theater in a denver suburb last july. the judge will decide if there's evidence to put holmes on trail. that's a look at headlines making news this hour. back to you. >> uma, thank you so much. fiscal cliff deal reached by

congress delays across the board cuts by two months, but the next guest say it's no free ride for defense stocks. the executive director and senior analyst, thanks so much for joining us. this is just a temporary measure, obviously; right? staving off dealing with the problem for two months. what do you think happens then? >> well, you're right. it just pushes out the start of the cuts by two months, and the issue is that the next time the congress deals with these cuts is going to be probably inspect context of the next debt ceiling debate, and the republicans in the house have said they will use the next debt ceiling debate to try to cut more money out of the federal budget so i think the next time around, you know, the defense department, other federal agencies in the position of begging for money back at a time when the whole pot will be shrinking further. it will be a difficult setup. >> absolutely. you were more optimistic the last time you were on, you know, the reason that you're -- i mean, you were a lot more

optimistic, less so now. is that because of the timing issue? >> well, i think, you know, two weeks ago, it seemed like we were close it a grand bargain, and to have the grand bargain to be reached where taxes and spending were dealt with at the same time, i think it was looking like maybe sequestering could have been avoided entirely. the issue now is we've done the easy part. we've kind of embedded taxes lower for the long term. would have been easy to say, hey, raising taxes, use those extra revenues to pay for the sequestering funds. that opportunity was missed. i think that opportunity's not coming back. >> buying time here, $24 illion in order for us to shut that off. not a cheap price. what's that mean in terms of stocks? boeing, lockheed, race young, dump all of these? hold them if you were in them? any winners in the group if they go down from here?

>> interestingingly, here for the next few weeks until people recognize the threat to the dod budget. i think the stocks could be under pressure. a longer term view, it's not necessarily disastrous. companies like lockheed martin, incredibly cheap, trading at nine time free cash lows. the bad news is priced in if you're a long term investor. short term investors, you want to avoid the stocks until the picture clarifies a bit. >> any one in there you call the pick of the group? >> well, i think that it's interesting. a quarter of the business today comes from international business, and that seems to be on the upswing. all the other companies have exposures at 10% and 15%. lockheed martin is interesting with a dividend deal of 5%. the deal is if there's incremental budget cuts, their biggest program, the f-35 could be under the knife. >> yeah, that would be

dangerous, but raytheon, if you're a player, and want to go against the grain, that might be interesting with a long term time horizon. >> yeah. >> appreciate your time. >> my pleasure. >> i was trying to think of a segue from the defense contractors to jewelry now -- >> can't wait. >> big metal makers to little metal makers. does that work? >> yeah. >> is it sly? >> yeah. >> tiffany renewing the long time partnership with the long time designer peretti dine designing jurel for 38 years. they lock in the partnership until 2032. the designer was considering parting ways with tiffany, but both sides could not agree on a deal to split. the new agreement gives a one time $47 million payment to peretti, a one-shot deal, $47 million straight to them and removes a cloud of doubt hanging over a collection thatting thes for about 10% of tiffany's

global sales, and, of course, that's the collection with the initials, the lines, and the soft angles; right? you know. >> charles made the point recently that tiffany is in need of being revamped and updated, and it's not just pretty, but that's been around forever. working with them since the 70s, hired her for another ten year or twenty year deal here, $47. there's got to be fresh talent out there who is cheaper. i don't know, i don't think it was a good news. >> the stores also need to be cleaned up. we'll see what happens. >> that's right. >> a huge day for the markets, 230-point rally on the dow, congress struck a deal to avoid the fiscal cliff, but will the euphoria last and markets, remember, there's another congressional battle on the debt ceiling around the corner. >> look at today's winners and losers on the s&p500 right now as we head out to break. metlife is there trading up better than 6% on the day. we'll be right back. ♪ this is $100,000.

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melissa: welcome back. time for stocksing a we do every 15 minutes. let's head to the new york stock exchange. nicole petallides is standing by. what are you watching? >> i'm watching a market that has taken off. the dow jones industrial average up 225 points. this is on a day we watch lawmakers in washington take it down to the wire and finally with some legislation that averts the fiscal cliff. so there is obviously some optimism and happiness here on wall street. we avoided complete disaster. they still have more work to do in the months ahead. for right here, right now it was good news. you can see investors certainly taking it as such.

the dow jones industrial average up 230 points. tech-heavy nasdaq up 2 1/2%. s&p 500 also a winner. most of the names on wall street have up arrows. the dow, all 30 names, for example, have been in the green but some names in the retail sector have come under pressure. they have met with some downgrades this first trading day of 2013. names like target, ann taylor, american eagle are names we've been watching as jeffreys reduces them to a hold from a buy. we have chain store sales numbers. target down 1.3%. ann taylor down nearly 4% on the day. these particular names, not participating in this broad based maaket rally which was really a global rally. we took the lead from what we saw abroad and here we are today with some great numbers on the major averages but the retailers are really to the downside the back to you. lori: thank you for that

report, nicole. showing optimism avoiding the dreaded fiscal cliff. will it all be sunshine and happy this year? we're joined by a bull that says the s&p will trade above the 1500 level. we're pleased to say happy new year to, you welcome to you chad. >> happy new year to you as well. lori: you have a keybanc, jpmorgan, saying the fiscal cliff deal will still cost the gdp about one percentage points in terms of growth this year. >> ha is very pullish, actually. expectations early on were for a fiscal drag of around one to 2%. that is one of the reasons why the market is rallying today. lori: sorry to come in here, what i wanted to point out was, yes, it is less of an impact than expected growth barry 2%, 2 1/2% in the first quarter that is kind of a big chunk, that is still a big chunk of economic growth that will be

shaved off. >> right ow we're at stall speed and that is why the market is trading around the 1400 level. expectations are for around 1 1/2% gdp growth for this year. okay, for q1. okay? now, the expectations though is that going forward, in the outer quarters, that growth will reaccelerate as the consumer starts to pay down their debt and also, you know, reinvest back in the economy. lori: nicole showed us the retailers though. they're all on down grades today. >> i wouldn't worry about the retailers. look at housing market. housing market starting to improve. housing prices are starting to two higher. auto sales, for example. we're close to a 15 million annual run rate that bodes very well for the u.s. economy. you have to add onto that, once we get over that march debate and they're going to go and get into the trenches and they will battle it out, we all know that, right? once which get over that you

should see corporate spending rate start to click higher again. that will contribute to fdp and contribute to earnings. lori: brian gardner our guest earlier this hour, a at some point the bond vigilantees may decide to show up with the whole debt ceiling debate showing up. we have the big s&p market rally. only a matter of time before the markets will become roiled here. people looking at greece what is happening in europe and say we're scare littlely close to that. >> i don't suspect we're remotely close to the dpreex issue or european issue. lori: why? >> we have federal reserve. lori: we're manipulating interest rates. >> we can print money. that is one thing we have been doing last 50 years we have the ability to do that. two, we're self-sustaining economy and we're growing on its own. that bodes well, okay, for economic growth. now interest rates could rise as the economy improve. if we hit the inflection

point where gdp on real basis is growing by 3% you will see rates on 10-year bond actually start to rise and get above the 2% level, perhaps 2 1/2% for 2013. lori: you're not talking about a quick and dirty shock to the system? >> no. lori: let's talk about stocks. this is always fun and we've been grilling you. oracle you like. valuation remains compelling. >> 12 times this year's number. technology stocks we favor. we're overweight technology in the portfolio. look at oracle, apple as example. lori: i'm running out of time. apple had a big jump in the trading session. 454. where do you see apple -- 545. >> i see 12ers upside in apple. lori: thank you for your outlook. many people do. thank you. melissa: warren buffett has done it again. berkshire hathaway beat the s&p 500 in 2012 even though the company did not make a major acquisition last year. class-a shares rose 17% versus the 13% gain for the s&p 500. berkshire's recent growth

can be attributed to a $5 billion bet on bank of america and stock buyback from a long time investor valued at $1.2 billion. they did even better if you analyze the book value. up 7.8%. lori: warren appreciates that. he appreciates you adding that. melissa: there you go. real progress or is just washington kicking the can down the road. lori: that is my band. melissa: puttings off the inevitable. lou dobbs is back. with physical -- fiscal advice for washington as lawmakers gear up for the next debate on the debt ceiling. i don't know. lori: interest rates today. 1.83 on the 10-year. we're back in a moment.

melissa: it wasn't pretty but congress got a deal to save is from the fiscal cliff so everything is great now, right? no. another cliff is coming just two months from now. congress will have to act to raise the debt ceiling. lou dobbs is here now to weigh in. -- raise the debt ceiling. >> i have to say i'm just relegating to all this the same trash heap that originated mayan apocalypse as well as the fiscal cliff. i'm not paying attention to their bull anymore. melissa: no. >> it gets kind of funny when you think about it, democrats save us from the republicans, republicans are saving us from the democrats. taxes just about everybody going up 2% because of the end of the payroll tax holiday. and the president is going to just talk about he nailed those rich son of a guns. melissa: yeah, good for him. >> meanwhile everybody's taking it in the ear is the expression goes i suppose. lori: it is just

mind-boggling just how everything kind of came down over the new year's holiday and now, we got that deal, but, it's reich, it accomplished so little and it is debatable i understand, but there are still so many -- >> there is nothing debatable about washington. lori: now we have to fight for the debt ceiling. we have to turn off the sequestration. there are still so many, it is exhausting, i think it was peggy noonan. this president can't get compromise. just one cliff after another. i'm totally paraphrasing. >> i think it is an eloquent paraphrase if i may say. who cares if it is a cliff? i was only partally kidding talk about the mayan a pock clips and y2k and fiscal cliffs. time for the republicans, god bless their little narrow minds, to start understanding that they're become outthought, outmaneuvered, outcreated and if they don't, the, this

eric cantor. he decides he is voting no. part of the leadership. lori: not until there were enough yes votes to get requisite approval for the deal. melissa: what would your advice be? >> i think republicans would he will be well-served to discover if they are a political party or simply a fund-raising origination and a branding mechanism. because they seem to have no ground operation which is essential if you will be a political party and you're going to it up candidates for president. they don't seem to have any principles they won't abandon. they seem to have no vision they will share with the rest of us. you i think they're really at cliff, they're at the precipice no longer being a relevant political party. lori: that is huge statement, lou. melissa: could they use the opportunity, whether the debt ceiling or --. lori: sorry to come in but the social issues. you know what i mean. do they need to do better

job connecting with the general public on social side of things, gay marriage, abortion, stem cell research? >> actually i think the problem for them they're too well-connected on those issues to all the wrong people. they need to find that which combines. you will hear the republicans talk about the divisiveness of the left, the class warfare of the left. but what is it about the republican party that brings the greatest number of people together, the common talt they seek in their philosophy and party. melissa: belief in the individual over government? >> there is a nice abstraction, let's try that again. i'm serious. the republican party is full of bull, all right? use words that --. melissa: one sentence, what do you think should be the mantra of the republican party? >> i'm an independent. not my problem! if the republicans want to continue to repeat the same, silly, stupid mistakes in the way in which they govern themselves in the house of representatives, or the united states senate, in a

contest with a leader, a president, who has told them straight up, that they're going, he is going to crush them like grapes and then proceeds to do so, because he understands that they don't have the energy and the principle and the passion to stand up for a single thing that they say, they do. melissa: could this be at opportunity, with the debt ceiling saying getting serious about spending. now we given you the taxes and really stand their grand and stand together. they could, they could. it would be apopportunity. if anyone is listening out there. >> i would say it was possible that mitt romney could be elected president given the fact that we had the worst economic performance over the preceding four years that we had in some time but that was obviously proved wrong. and it was proved wrong for the reasons i already articulated. the republicans have to understand that they are literally at the edge of

irrelevance and if they don't understand that they have to appeal to those who vote, to those who want to stand, them to stand for something that they shared, you're talking about the individual, the freedom of the individual, who, i mean, are you kidding me? we're talking about patriot act, the patriot act is enthusiastically supported by republicans. as democrats, who first --. melissa: not what they stand for. i'm saying if you had to put out a one sentence what you believe in. >> iim a little more pragmatic than that. melissa: i hate the government and i believe less government in every single situation. >> i join you in that. i share that value and i think millions upon millions americans do. right up to the point where they need the government. where they see corporate america break the social contract, tear it to shreds, whether an employee sponsored insurance as they have done. whether it be on defined pension benefits as they have done.

and the result of 401(k)s which have been eviscerated by the excesses of unregulated markets, which the republicans said they stood for. you know republicans laugh when obama says, you know, i've got to blame it on george bush. well the sad, pitiful truth is, no matter how we scoff, some of that is true and true enough. and the republicans could not intellectually adhere to that reality. melissa: lou dobbs, thank you so much. >> correctly identified. melissa: every day here at this time. 7:00 and 10:00, also of course on your program at 7:00 and 10:00 p.m. eastern. tonight catch him with congressman tim huelskamp, republican from kansas, a member of house budget committee. you will hold his feet to the fire i have no doubt. >> i will have a nice, intelligent, low-key conversation as we --. melissa: you're always low-key. when i think of lou dobbs i think of low-key. >> mustering when i can

enough care and compassion for events that will alter and illuminate our times. great to be with you. lori: thank you. all day long peter barnes is breaking down the bad news for you. last night's fiscal cliff deal by income. his next report coming up at 2:00 p.m. eastern he will look at what the debt deal means. melissa: a lot of math for him today. lori: for those earning 200 to $500,000 a year. if you missed his last report on folks making $100,000 per year, check it out on foxbusiness.com. quarter to as we do every 15 minutes. let's check the markets. nicole, people are happy today, what about tomorrow? look at the crystal ball i suppose. >> nobody really has a crystal ball, a great question. i was talking with someone like jason weisberg and they have talked about the momentum and breadth, market breadth looking pretty good here today, the idea is the january effect. the fact a lot of people

sold great companies in 2012. companies they didn't want to sell. they took the profits. they wanted to beat the tax hikes and so, got out of the market. took the cash and been sitting on the sidelines of the this is the january effect where people get back in. so the idea here is that some folks think that we're going to have a great january and february until reality sets back in and we hear more from washington and get more on corporate earnings. back to you. lori: nicole, thank you. with everything going on in d.c. it is easy to forget the president has some key cabinet positions to fill. charlie gasparino joins us with exclusive info on the hunt for the next treasury secretary. melissa: minimum wage workers getting a boost in 10 states but cat lovers losing big this new year. the serious and the whacky new laws for 2013. let's look at some of today's winners and losers as well as we head out to break on the nasdaq. viacom is trading higher by better than 6%. we'll be right back

lori: with the fiscal cliff drama over for now until we fight about the debt ceiling the president is poised to pick his next treasury secretary and charlie gasparino has the latest on

that in his column today in the "new york post" who says the drama might be over, but the pain, well it is still headed our way. hi, charlie. happy new year. >> happy new year from southern california wine country, which i will start indulging right after this broadcast. lori: i heard bell chink. >> indulging. lori: indulging. what kind of town are you in, my old stomping grounds. >> what time is it? lori: lovely. enjoy. what have you got. >> they still have phones here. so i did reporting what is going on with the treasury secretary. here was the deal. it was, i think president obama wanted to pick his treasury secretary after the fiscal cliff deal came down. had the deal last night as you know. so what i hear from wall street sources with pretty close ties into the white house, what they're saying he is ppised to name his next treasury secretary. we understand that, you know, at least the signaled that are coming out of the

white house the announcement could be coming this week. as you know there were two candidates towards the end that were leaked. one we apparently the first to talk about, was jack law, -- jack lew, his chief of staff. bloomberg did a story. this is from what wall street sources hearing from the white house unless something dramatic comes we're hearing it will be jack lew as treasury secretary, just about a done deal. you can never say deficit. the president is not talking to me. it is his choice obviously. but at least that is what is coming out of the white house to wall street will be jack lew. kind of an interesting guy. clinton budget director as you know. citigroup for a while. has wall street bonefides. he is very liberal though and, you know, i think it will be lew, forget about what all they're saying. we point out ken chenault

runs american express, ceo, who was on the president's job creation panel. behind closed doors, ken chenault was somewhat critical of president. did not talk to the panel for more advice. ken we should point out worked at bain capital early in his career. would be very ironic choice to pick ken shathough -- chenault. jack lew is very liberal. this is not a partisan political statement. this is what policy will be like coming out of the white house. that policy, it will affect taxes. it will affect wall street this will be very, if you think level of center first term, this will be a agenda that very left-of-center. i believe he will push for more taxes. closing loopholes and things of that nature. that was, essential topic of my "new york post" column. this is guy the pain is

going to come. we're getting higher taxes and more deficits. melissa: mack to the vineyard for you, charlie gasparino. thank you so much. i'm sure he has a very refined palate, out there sipping the wine and nuances. lori: i hope he brought his wife because --. melissa: that can be interpreted a lot of different ways. let's move oners it is a new year and new laws. 10 states kicked off the new year with a boost to the minimum wage of 10 and 35 cents. the increase will put an extra 190 to $510 per year in the pocket of about a million people, nothing to sneeze at. melissa: depending where you think the money is coming from. lori: in the carolinas, companies with more than 100 workers will be required to check the legal status of new highs. come july this will come to companies with 25 more workers. not all super serious. concord, massachusetts, single serving plastic water bottles are illegal. melissa: illegal!. lori: stores will be fined

50 bucks but not to worry. exemptions are allowed during emergencies. melissa: thank goodness. lori: in illinois, on a motorcycle and pop a wheelie will cost you a 1,000 bucks. no fear you are allowed to run a red light. makes no sense. i can't pop a wheelie. that is ike evil knievel stuff. me yow!. this is the bet one. no more than four cats per household in wellington, kansas. melissa: isn't that common sense? lori: if they limit number of dogs you have in a household, i will have problem with it. dogs, no way. never have puppies. melissa: coming up tonight on "money" this is the real story of the day. attorney joey jackson joins me to talk about the crazy case, i was treating about this earlier. this is the craig's list sperm donor is being required to pay child support, even though he signed legal documents he had no financial responsible

for the babies at all. sold sperm on craig's list to another couple. this is fascinating story. i have actually know other people in this situation. so this, this is happening more than you think, america. you want to tune in and see what your rights are in this situation. lori: "modern family", that's for sure. melissa: there you go. lori: still have trading time ahead with the dow up 220 points. new jersey governor chris christie is expected to speak about the failure of the house to pass the much-needed aid bill for victims of hurricane sandy. we'll bring you the comments live. tracy and ashley will take you through the next hour of "markets now". here they are [ male announcer ] where do you turn for legal matters?

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this is broad-based money and we'll bring you the latest winners all hour. tracy: taxes are still going up for millions of americans and not just the wealthiest. we'll tell you how much it will hit your paycheck ahead. ashley: and outrage after the house fails to pass a multibillion-dollar bill to help hurricane sandy victims. the go of -- governors of new york and new jersey are upset calling it inexcusable. new jersey governor chris christie expected to speak out this hour. we'll bring you his comments live. tracy: it is unexcusable. top of the hour though. time for stocks as we do every 15 minutes. nicole petallides on floor of the new york stock exchange. nicole, markets are soaring. sure there's a deal. first day of the year, markets are generally up? >> the january effect where sometimes people selloff in the prior year due to tax concerns and tax reasons and sort of get back in and that's what we call the january effect itself.

however in this case you're seeing it more accelerated because over the last five years you've seen selling, particularly in the last year there was so much concern about the fiscal cliff, people were selling companies they thought were good companies just to take the profits and not lead to higher taxes of 2013. over the next few months or so, particularly january and february, you may see some buying back according to traders that i have spoken with. as we talk about the up arrows where major averages are up 1 1/2% and nasdaq is up 2%. all 30 dow components are higher. all 10 sectors are higher. hewlett-packard is bouncing back after being the worst performer in 2012. bank of america added to conviction buy list at every c.o.r.e., talking about it is a great bank. ashley: breaking news. new jersey governor chris christie holding a news conference after the house scrapped vote on aid for superstorm sandy. let's listen in to the governor. >> nearly 600 state roads were closed. nearly 7 million

new jerseyians were without power, some up to 14 days. nearly of00 state roads were closed. 127 shelters, housed and fed over 7,000 evacuated citizens. all regional mass transit and hudson river crossings were closed. all new jersey schools were closed, some for weeks. tens of thousands of businesses were damaged or destroyed with many still closed. our jersey shore was devastated with the loss of homes, public buildings, and iconic symbols of new jersey culture and economic vitality destroyed. our citizens answered 2013 unsure of their future. as they spent the holiday season displaced from all that was familiar and comforting. 31 days for andrew victims. 17 days for victims of gustav and ike. 10 days for victims much katrina, for the victims of

sandy in new jersey, new york, connecticut, it has been 66 days and the wait continues. there is only one group to blame for the continued suffering of these innocent victims. the house majority and their speaker, john boehner. this is not a republican or democratic issue. national disasters happen in red states and blue states. in states with democratic governors and republican governors. we respond to innocent victims of natural disasters, not as republicans or democrats but as americans. or at least we did until last night. last night politics was placed before our oath to serve our citizens. for me, it was disappointing and disgusting to watch. on january 19th2010, i took an oath to serve all the people of new jersey without regard to race or ethnicity,

gender or political affiliation. and for the last 1079 days i worked as hard as i could to be loyal to that oath. whether under the pressure dealing with a legislature of the opposite party, or the scrutiny of a hotly-contested election, i have always put the people of new jersey and my oath ahead of petty, personal politics. last night the house of representatives failed that most basic test of public service and they did so with callous indifference to the suffering of the people of my state. if you want an example how nonpartisan this issue should have been i offer this for your consideration. near midnight last night conservative congressman chris smith of new jersey, and former speaker nancy pelosi of california both spoke on the floor in concert with each other and in support of this aid package. that is one for the record

books i suspect. on the equities this should be a no-brainer for the house republicans as well. both new york and new jersey used the international firm of mckenzie and company to assess and quantify the damage to our states. our professional staffs have spent countless hours with congressional staff providing leadership and backup documentation for all of the damage claims. governor cuomo and i --. ashley: we have been listening to new jersey governor chris christie responding to the nonvote on that aid bill for victims of superstorm sandy. he is blaming the house republicans and house speaker john boehner, he said this is not a partisan issue, calling it disappointing and disgusting. tracy: so the house of representatives failed with callous indifference, pointed out that katrina got their funding in 10 days. it has been 66 days for new york and new jersey and congressman bill pascrell from new jersey also pointed out new york, new jersey, we

send a load of money in tax dollars to the federal government. ashley: oh, yeah. >> the least they could do is pay attention to these areas that are --. ashley: very upset. tracy: he said it was disgusting to watch. ashley: disappointing. despite reaching a last minute deal last night on the fiscal cliff many americans will still be paying more when it comes to their taxes in the new year. peter barnes joins us with the breakdown. >> ashley and tracy the house did get that tax bill done that night and a bunch of new taxes are hitting taxpayers this year including from the tax bill last night. we've been looking at their impact on difficult income brackets each hour of the day here on fbn. this hour we're up to the household income of 200,000 to 500,000. and the big change this week was the restoration of the top marginal tax rate of 39.6% from the clinton era for individuals making more than 400,000 a year and families making more than 450,000 a year. now those taxpayers will also see the rates on their capital gains and dividend

rise to 20% from 15% under this bill, unrelated to this bill, however, is the new tax under the president's health care reform law of 3.8%, a medicare surcharge on investment income for individuals making more than 200,000 a year and families making more than 250,000 a year. but the tax increase that will hit almost all taxpayers, lower income as well as upper, is the expiration of the payroll tax cut from the last two years. let's look how the tax picture is shaping up for the higher income households though, 200,000 to 500,000 a year. according to the tax policy center their taxes will go up on average by about $2800 this year. most of that because of the higher payroll tax on the first 110,000 of income but some of these taxpayers will pay that medicare surcharge and under the new tax law start seeing some of their itemized deductions limited a bit and those household in

that group, making over 400 and 450 will start paying the top 39.6 marginal rate plus the higher rate on cap gains and dividends of the tracy and ashley, back to you. ashley:. peter thank you very much for outlining that part of the tax hike. and stick around next hour to see how the fiscal cliff deal will affect americans making between 500,000 and one million dollars per year. by the way you can check out the details for every income bracket on foxbusiness.com. tracy: that 3.9% on medicare wages as well. there are a lot of little ancillary taxes as well. that is over 200,000. ashley: adds up. tracy: nickel and dimed. we have barely avoided going over this fiscal cliff but what is become increasingly clear the state of america's economy remains on a real slippery political slope. so what are the implications? we have the former clinton

advisor, timothy punk and senior director of the bipartisan policy director, steve bell. i will start with you first. everyone is saying democrats won, how do you win when we're being taxed more and more money is being pulled out of this ailing economy? >> well, look, first of all i don't think anybody should be doing an end zone dance on this deal but i think we do have to recognize there was important progress made. we did avoid going over the fiscal cliff. that is obviously important not just for the economy this year but our long-term economy and i think you see the markets recognize that. i will say one thing, everybody recognizes this is just step one. what everybody is talking about from economists to business leaders we need 3 to $4 trillion deal here. this is $600 billion deal. this is step one in the process and i think the president, you saw the president acknowledge that last night. tracy: are you happy with what happened, steve? i guess one could say we averted, avoided the inevitable but at the same time, we didn't even get one

spending cut that people were looking for. the american people want to hear that the government is getting its act together and we didn't see that. >> no, i think this is extremely disappointing. yes, you had to do it to avoid going off the cliff and raising taxes on so many people but it as though you took someone and threatened to throw them off the top of a mountain and at the last minute you said, oh, i didn't. give me an award. that is really what you're seeing here, is a self-imposed almost suicidal kind of thing on the part of congress and the president and now they want to, markets apparently are congratulate them with great burst. i never understood markets like this because over the long term, two or three, our indebtedness is much worse and spending continues unabated. tracy: i think the market is exhaling we got one thing done in myriad of list of things you have to do.

we're moving to the debt ceiling. two months is not a long time to discuss this especially if congress waits to the last minute. >> i think that is exactly right, that point on the market, that the markets are reacting postively today. but let's have the conversation again in a week when everybody has a chance to take a closer look at the deal and also reflects on the fact that we will spend the next eight weeks doing exactly what we've been doing the last eight weeks, negotiating yet another deal. it is important progress but also something that will continue on and be frustrating for a lot of folks. tracy: sure is. steve, is john boehner's leadership on the line here? chris christie is certainly not happy with him. >> mr. christy, bless his soul doesn't have a vote in the house. fortunately for john boehner. i think mr. boehner will be reelected speaker tomorrow after the swearing-in of the 113th congress. one thing very important going forward. let's say you cared about immigration or you want to talk about gun laws or want

to talk about infrastructure. things like that. we're not going it do that for the next three or four months. we'll have the same conversation that we just had for the last 18 months which is, are we going to have the debt bill passed in time. are we going to have the government close down because of appropriation bills. are we going to cut spending because of the sequester. what we've done is many could press, and i think exacerbate the dysfunction here in this town. if you think that playing with the fiscal cliff was a big deal, i assure you if you talk to anyone serious playing with the debt ceiling is really playing with c-4. tracy: timothy, steve, maybe the 113th congress can do a better job when they get in on thursday. thank you both. >> thank you very much. >> thank you. ashley: the bar is pretty low. tracy: honestly, they just have to show up at this point. ashley: coming up, is 2013 the year of the new car. we'll tell you about a bold prediction for the beleaguered auto industry.

that is coming up next. tracy: cashing in on the nfl playoffs. we'll look which teams are poised to win on big revenues. as we do every day this time of day let's look how oil is trading. it up about 1%. 92.97 cents. we'll be right back.

tracy: it is quarter past as

we do every 15 minutes let's check on the markets. nicole petallides on floor of the new york stock exchange. nice to see it 224 points. >> nice to take a winner. drug stocks, bank stocks, the dow jones industrials up 223 points right now. the tech-heavy nasdaq best of the bunch up almost 2.4%. names like hewlett-packard and intel and cisco. a lot of those tech related names are doing well. want to check in on social media. let's looked a facebook and linkedin. linkedin has come under pressure here and that is because barclays was very bullish on them but they think linkedin's initial forecast could come in below consensus estimates. on the other hand, facebook up over 5% at this point at 28.11. talking about jpmorgan raised its price target. the new price target is $35 up from $29. not the 38 ipo.

but upside potential. talking about ad revenues and those are likely to accelerate. so those are good positive comments for jpmorgan on facebook. as a result you're seeing facebook as a real winner today. back to you. tracy: thank you, nicole. we'll see you in 15 minutes. ashley: new car sales are forecast to be a bright spot in the economy according one research firm. polk see sales to grow 6.6%, exceeding 15 million vehicles. these numbers based on expectations for new vehicle registrations. the director of polk says autos are looking quote, to be one of the key sectors that leads the u.s. economic recovery. we talked about this before. a lot of cars out there, 11 years old is the average. financing is pretty easy to get these is today. it is definitely, i think we're seeing better teams ahead for the auto industry. tracy: i hope so. i think there is a lot of reasonably pressed cars on the road. ashley: yeah i agree. tracy: earn the volt.

we've got much more ahead on this rally. few people predicted 2012 solid gains. so can 2013 keep up the market mow hundred tum? fort washington cio nick sargen talks about his targets next. ashley: the dow is up 233 points. well, it is stronger. euro down against the dollar. the pound is down against the dollar as well. the euro actually slipping back as the trading day has gone on. we'll be right back.

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>> 21 minutes past the hour i'm uma pemmaraju with your fox news minute. new jersey governor chris christie saying house majority and speaker boehner are only group to plame for inaction on hurricane sandy relief. president obama is urging the house to vote on the bill without delay. new york lawmakers from both parties lashed out at the decision by house gop leaders pulling measure calling it a betrayal. house speaker boehner says hurricane cain sandy relief is. penn state is suing for the harsh penalties.

korb bret is saying the sanctions which include a $60 million harm past, present and future students. students ho attended sandy hook elementary school in newtown, connecticut will go to class tomorrow in a former middle school in nearby monroe. a open house is being held for the children. the children have not attended class since the gunman killed 20 students and six teachers there last month. that is the quick headlines making news on fox news. tracy: uma, thank you. a lot of schools are making snowflakes to decorate school when they come back. my kid's school is participating that is cool. commodities are higher as traders cheer about the deal to avert the cliff but as negotiations over the debt ceiling grins. what really lies ahead for your money? san dry smith in the pits of cme. what is today's trade, sandra? >> crude oil prices up more than a buck, above $9 a

barrel. as you turn around looking at gold prices still up around 11 bucks a session. i want to bring in ben from traders audio. we're significantly off the highs of the session in most of the major commodities, let alone the stock market off its highs. i'm hearing amongst traders is this sort of a lack of conviction in this big rally? >> in terms of follow-through we're seeing limited conviction. the s&p basically had the 27 handle move through the open session and zero follow through. so there is lot of traders right now asking if this was full release if you will after the news type effect and just seeing some sellside activety in reaction. up 27 happened else. there is conviction to the upside. low follow-through. low energy. >> ben, i will, i literally made him run down from the trade. these guys are much busier day than they have been the last several trading session. i will let him get back to work. this is rally traders will

watch to see if it actually lasts basil very prices have been a big winner in today's session. the at one point up more than 4%. just up 2% on the session. everything is sort of coming off under the circumstances highs but still substantial gains across the board. this is the point where everybody asks themselves is this rally short term or is it going to be a longer-lived rally. ben said, they're watching. back to you. tracy: so is everybody. sandra smith. thank you very much. ashley: 2012 may be in the history books but 2013 isn't exactly offering a fresh start. global economic issues remain as well as several unresolved issues from the fiscal cliff. so the big question is, how should you shape your investment strategy this year? joining us is nick sar again, chief investment officer with fort washington investment advisors. look, nick, thank you for, welcome to you. look, 2012 we got double-digit returns on the markets. can we expect the same for 2013? what are you expect the year to bring?

>> i don't expect a good of returns because a lot of good news is priced in but that said i think we could have another solid year, maybe high single-digit returns. the interesting call, do we get a test of the all-time high for the s&p, 1565? and i think that is definite possibility. the one other thing though i would say that is, four years running, bonn investors have had a great run as interest rates have come down, bond yields. you have capital gains. ashley: yeah. >> those days are over. people putting money in bonn funds and out of equities time to switch away on that strategy. ashley: time to got out. talking of stratis if, financials are coming on strong today. i guess you could say that about most sectors. >> yes. ashley: with regard to financials in particular do you think that is momentum that can keep going in 2013? >> we do. we have had a value strategy. so it hurt us in 2011 when financials had a tough time

but we kept the faith and held onto them and therefore were rewarded in 2012. our call would be still relatively cheap sector. if the economy does okay as i think it will, i think it can be a good sector. i don't think again you will get as strong returns as in the last year. ashley: nick, talking of values do you think stocks are a good value right now or about fair? other people say they're cheap. other people say, no, they're in line where they should be? >> i was having a little trouble with the audio i think you're asking me about value in general. ashley: yes. >> yeah. the basic call we're making is, what is priced into the market for a long-term earnings growth? and we think something five to 6% per annum. we think that's a reasonable expectation. we think value for the broad market is reasonable. one of the sectors we've liked is the dividend-paying stocks in a low rate environment. for a while we were worrying had that run up too far too

fast? i'll tell you one thing, even though there is lot not to like in the fiscal deal, the one thing we're relieved about is that the dividend tax rate only went up from 15 to 20 as opposed to 15 to 39.5%. so we do believe, both playing value stocks and playing high dividend-paying stocks is good strategy in low-rate environment. ashley: with regard to the global economy, yes it has on about very quiet out of europe because so many eyes are going on in washington but there is still a lot to be sorted out in europe with their debt problems. are you concerned what that may bring this year? >> i would say the following. the good news is that the european central bank, by deciding to purchase the bonds of sovereigns in trouble, they're now acting as lender of last resort for the eurozone system. so the fear we all had, could this break up, i don't think that's on the deck for 2013. we could talk longer term.

but the one thing is, so you stablized the financial system but you haven't stablized the periphery of europe, their economies. ashley: yeah. i. >> do worry there is too much reliance on austerity programs and therefore they can't grow their way out of their problems. >> right. >> basically my story i like i don't have to worry about a blowup in the eurozone but europe is still will have a very tough time economically. ashley: i agree with you there. thank you so much. nick sargen, chief investment offfcer with fort washington investment advisors. nick, thank you very much. >> thank you. ashley: the good news he doesn't expect europe to blow up but there is always something going on there. been nice not to talk about it. also nice not to have to say fiscal cliff every other word. coming up the tax hike very few people are talking about. the social security payroll cut is going away. gerri willis will tell you how much it will take out of your paycheck.

tracy: first a look at the loser on s&p 500 as we head out to break. metlife up 6.07%. constellation brands because everyone was drinking all weekend. that is up nearly 6%. we'll be right back

>> 30 past the hour, a check on the markets as we do every 15 minutes. nicole's on the floor of the new york stock exchange. nicole, what's the mood like on the floor with the rally up more than 200 points? >> a load -- a lot of bulls not complaining. what do you think the mood is? >> not complaining, surely, i mean, it's great, but i think the volume's still a little bit better, but not terrific. i think, you know, we're very

headline driven, and if tomorrow if there's a bad headline, volatility to the other side. that's what people are thinking and wanting a little bit more consistency in the good headlines. >> we talk about washington, obviously, the lawmakers avoided a disaster by coming to an agreement, at least now for the short term. what do you think. do you think the january will have cash on the sidelines coming back in? >> i think there was probably some back in, but i think there's still a lot of out there waiting. you know, i think february 28th, i believe, is the date on the debt ceiling. that's coming up. these things come up one after the other, faster and faster. we want to see a lot of positive headlines consistently and not volatility because that leads uncertainty for investors. >> areas with investors, talking to people on the phone all the time, areas where people say this is a little safer bet, more risky, what do you advise? >> well, we're not advisers, but

traders, and that's not part of the decision process that we make. >> how do you feel? are you optimistic or worried? >> that i always have an opinion as we know. i'm very cautious because traders feel we're going to be volatile, and that makes the average investor nervous. >> all right. you got to take it day by day, take it easy. if you're cautious, in particular -- >> make up your mind and live with it, you know, one or the other. >> right, know the risk appetite. what are you willing to put on the table and potentially lose to gain. back to you. >> valid points. thank you so much. back in 15 minutes. >> congressmen passed the deal, but now the next debt line only two months before the nation's debt ceiling has to be raised. rich edson on capitol hill with more. you know, this is what we do, kick the can like champion soccer players. >> well, you know, tracy, took 20 minutes for the next fight to start. the bill passed, a temporary

heal for the fiscal cliff, and 20 minutes later, president obama came out and made remarks on the debt ceiling. that's right, the next fight coming up here in washington, and when it comes to raising the debt ceiling, as the president puts it, he's not playing any games. >> while i will negotiate over many things, i will not have another debate with this congress over whether or not they should pay the bills that they already wracked up through laws they passed. let me repeat. we can't not pay bills that we've already incurred. if congress refuses to give the united states government the ability to pay these bills on time, the consequences for the entire global economy would be catastrophic. >> now, the president may not want another debate, but he's now in the middle of another debate. we spoke with a spokesperson for house speaker john boehner who says the speaker's position's clear. any increase in the debt limit

must be matched by spending cuts or reforms that exceed the increase. the president knows that. as timing when we need to go raise the debt ceiling, there's extraordinary measures. we hit the debt ceiling new year's eve, and can use $200 billion worth of deficit spending. they are flout quite sure when that runs out, though, around two months after is the time frame they looked to offer more guidance as we get closer. back to you. >> rich, thank you very much. you know, i know you're talking about football in a bit, and in football, they fire the coach when the team does not do well. we don't blame the team, but here, we just blame the point. >> very profound, tracy. breaking news, oil, well, reflecting the broad rally on the market today, up a dollar-30 for the day's trading at 93.12 a barrel, a gene --

a gain of 1.5%. oil getting more expensive. speaking of getting expensing, other than the debt ceiling, there's another problem unresolved. a temporary social security payroll tax expiring, and, yes, hits every level of wage earner. gerri willis here to get into the issue. >> the president says we're not raising taxes on middle class people. wait until you see the first paycheck. that payroll tax program where they dropped 2% off social security payroll tax is going away. we had that as part of trying to get rid of the recession. now, here's way you'll see, people earning $40,000 pay an additional $579. if you earn $75,000-$100,000, $80, and if you earn over a million, holy cow k look at that, $175,000 in additional

taxes. all well and good to call it a wealth increase for the wealthy. it's not true. everybody gets hit this year, and i mean this year. >> it was a temporary holiday tax; right? maybe not the best time to repeal it or expire, but it was meant to be temporary. >> always meant to be temporary, but debates whether to allow it to continue, and conversations have been is now the time to let the tax hikes come back into play when the economy as weak? >> from peter to pay paul. draining social security. we should have never allowed it in the first place. giving a baby candy, all you have after you take the candy away is a fat, angry baby. >> that's at best image of the day. the fat angry baby. >> don't give a baby candy, and don't take tax breaks away you know you can't keep. >> we needed major tax reform, rethink how we tax americans, rethink entitlements and spending. >> yeah, the whole thing opinion

>> we over promised and cannot deliver. it's that simple. >> all right. is this the theme for tonight's show? one of them? >> the other thing i'll cover you want to hear is all the little goodies, the pork in the ridiculous bill, hollywood, lloyd blankfein, usual suspects getting money. >> prepared to be outraged. >> hollywood, outrageous, come on, now. >> don't miss "the willis report" tonight, 6 p.m. and 9 p.m. eastern here on fox business. >> prepare to be outraged. coming up, gold at a two week high, and one top strategist says it's going to go higher. u.s. global investors frank holmes will tell us just how high next. >> first, as we do every day at this time, look at the ten and 30-year treasuries. we'll be right back. music is a universal language.

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>> natural disasters plagued homeowners across the country last year, and while companies paid out billions in insurance claims, some were ignored because of a lack of proof. some companies are now offering people a new way of protecting themselves. fox news is in the denver office with the details. alisha? >> hi, ashley. we're talking about home inventory companies. these are businesses that me tickously record what you own of value so you're prepared in the event of a disaster, robbery, and come in handy in the event of a divorce. this is how it works. they come in, take a list of serial numbers, photos, an entire list of everything you own. kerry mitchell, who owns an inventory company in colorado springs, when people do it themselves, they forget about a lot of items. >> tools and things and sporting

goods. those are the things people don't really realize how much money and value. when it's a total loss like the fires we had, you have to replace every single thing, you know, tunerware, tooth brushes. >> think about the people who left their homes in the rush as hurricane sandy approachedded and how many are attempting to rebuild today. depending on the company, the inventory list goes on a server, flash drive, a cd, a cloud, you name it, when faced with disasters, homeowners don't rely on their memories and have doubting insurance companies. >> a lot of times, the insurance companies would, you know, question what you did have and what the value was, and if you have pictures of it, plus, you have, you know, a serial number or whatever, then they can, you can track it down to what those were, you know, cost at the time. >> the average cost to do an inventory on a home is about $5

# -- $550, depending on the size of the home. >> well spent too. appreciate it. >> needed that, huh? well, a big deal to avert the fiscal cliff not just lifting stocks, but gold at a two-week high, close to $700 an ounce. next guest says gold will hit $2,000 this year. joining us now, frank holmes, u.s. global investors' ceo and chief investment officer. you know, frank, glad you're hear. people last year said, buy gold, up 7% for the year. well, so was johnson & johnson, 7.5% and a dividend and apple, 35%, and i got a dividend. why buy into the gold bonds? >> well, there's continuing to be a battle between fiscal austerity and monetary inflation, and it appears monetary inflation is strong and remains strong, and if you look

at japan as a case study, we'll have qe4 and 5 #, and there's a high correlation to gold prices rising and monetary basic rising. >> this is basically a bet on more liquidity. that's what we are taking here? >> combination of two things. one is negative real interest rates, and when you have negative real interest rates, gold rises. a five year government note paysless than 1%. a ten year government note, just basically left at the inflationary rate. why buy a government note when you are basically going to buy a loss each year for the next ten years, and gold's always performed well in deflation. >> fair enough, but at the same time, liquidity loves equities as well; right? we've seen that in the stock market. while dividend tax rises a bit, it's not detouring people from buying into dividend stocks. why not just go to the equity

market? >> what's important is to buy gold equities, a key point. they are increasing dividends all of last year, and what's interesting is that since 1984, during the election year, gold stocks far under performed in the following year, in the post election year, doesn't matter democrats, republican, gold stocks put on spectacular performance so mathematically, the odds favor gold to rise based on this oversold, take a look at the models we created, going back to the past 20 # years, gold due for a rally of 15% to 20%, and looking at the post election cycle, dividend paying gold companies like franklin and nevada, ect., are attractive. >> franklin nevada, one of your picks. you are not buying the blocks of gold. you are going out, buying stocks. are you looking at the miners? what are you looking at in particular in the stock world? >> coming back to buying dividend paying tokes is key. gold should be # 5% to 10%

waiting in a portfolio. don't buy it to get rich. it's basically an insurance on portfolio. 5% on good quality jewelry, gone up dramatically in five years, and good quality dividend paying stocks in companies growing the balance sheet. >> frank, thanks for the tips. >> thank you. >> that means you should buy your wife some fine gold. >> yeah. why not some bling. do they still say "bling" these days? probably not. i'm just old school. time for stock z -- stocks now like every 15 minutes. nicole? still up above 200 for the positive side on the dow. >> that's right. old school is not a bad thing. dow jones industrial up 215 points now, a great day on wall street, up arrows, s&p 5 # 00 up 1.75%, techs up 1.3%.

small caps at new high, good news there, and transportation stocks, also, with up arrows. all the of this on the heels of the lawmakers averting the fiscal cliff coming to a deal, budget negotiations coming to fruition, make the deal, and markets celebrate today. back to you. >> send gold down to nicole. [laughter] >> thank you. >> or call her husband. coming up, ready for football? the playoffs are here, and they could bring big money to several teams. we'll take the franchises to the next level. forbes will break it down for us next. >> oh, but first, look at today's winners. market's up 213 points and a lot of winners. here are some. we'll be right back. ♪

♪ >> lost in the focus on the fiscal cliff with a slew of new taxes this year designed to pay for president obama's health care law, and elizabeth is here with the bottom line. like we said earlier, fed nickels and dimes. >> that's right. the president said in march of 2010 that the affordable care

act would not hit the middle class. tell you something, some of the tax hikes hit the middle class. here's the president in march 2010. >> millions of people will get tax breaks to help them afford coverage representing the largest middle class tax cut for health care in history. [applause] that's what this reform's about. >> well, no, the reform is about 20 new taxes, eight tax hikes, eight of them being enacted this year. we'll show them to you in a scroll coming on the screen. this is to pay for the high cost of affordable health care, $500 billion in tax hikes over the next decade. these are launched today. now, the -- you are going to see the flex health accounts capped. that's squarely aimed at the middle class. medical deductions capped, affecting the middle class, on and on there's others. you can't use health savings account to buy prescription drugs and the like. whether or not we see the congress going forward, as you

point out, tracy, you know, resending the nickel and dime moves remains to be seen. nancy pelosi said we have to enact the bill to see what's in it. you need a microscope. this is what we find going forward. we'll track all the tax hikes going forward, and they are slowly rolled out, starting already in 2011. ashlie-- ashley: adding up. tracy: they screw up with the stock market without knowing it. ashley: that's right. >> the other is medicare payroll taxes for medicare. tracy: right, which is unlimited. liz, thank you very much. >> sure. ashley: nfl playoffs three days away now, and some could have a much needed boost in revenue, but the next guest wrote about the playoff money link for "forbess," the executive editor of "forbes," thank you so much, mike. i read the article, and you said

the road to the super bowl can cost a team more money than it generates. is that possible? >> sure. there's added expenses for things like travel and running the stadium. you get a little help from the nfl for extra costs, but your ticket revenues are basically split evenly throughout the league. where you really can make money, if you're a playoffs team is if you're a team about to get a new stadium. you're talking about the vikings and the 49ers, both of whom should have new stadiums within three years, andering potentially -- and potentially the falcons in four years. that helps with sponsorships, naming rights, and personal seat licenses, which you have to pay a lot of money for, and that just gives you the right to buy season tickets. ashley: it's about timing as you said. really, the pay patriots the por child for getting a new stadium at exactly the right time. >> right. 2002, won the super bowl, move into the stadium that season,

and tom brady's a super star, won two more super bowls. gillette pays a lot for ticket prices, and in new york, there's a contrast with the giants and jets. giants won two super bowls in the past five years, a easier go of it selling personal seat licenses at metlife stadium than the jets have who struggled the last couple years, even though both teams share the same stadium. ashley: just because a team doesn't guarantee success, the top ten valuable teams in the nfl, just five in the playoffs. >> that's because there's so much parody in the nfl with over 60% of the revenues shared equally because of the new jersey national tv deals, the visiting team gets 34% of the ticket revenue, and you have that hard salary cap that limits what you can pay players. where it helps to have money is in the big bonuses paid out

front and prorate it over the course of the player's contract in terms of the sel ray cap. that helps, but the redskins for years have the highest payrolls in the nfl, and only this year, after this years, getting back into the post season. ashley: mike, we've seen a blizzard of pink slips, and not january sales at victoria's secret, but -- i know, i waited for that -- seven coaches, five general managers. unusual or the nature of nfl these days? >> unusual. i followed it for 20 years now, and never seen so much coaches and gms get the pink slip after the season ended. this goes back to parody. teams feel they can turn it around rather quickly because they will have as much or close to as much to spend on players and coaches as all the rivals, and we've seen new owners come in that are looking to turn around franchises that have been struggling. the con with the jaguars, for

example, he fired his gm, and same with the new owner of the browns, going to bring in a new coach there. they want to start new eras, winning eras. ashley: mike of forbes, always fascinating stuff. thank you so much. >> thank you for having me. ashley: watch the nfc wild card matchup between the seahawks and redskins sunday 4:30 eastern time only on fox. don't miss it. tracy: good stuff. the dow up 222 points. liz claman in the last hour of trading with a fox business exclusive. the ceo of et than allen and his expansion plans. "count down to the closing bell" is next. don't go anywhere. ♪ [ male announcer ] this is joe woods' first day of work.

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